Shares in Cable & Wireless Communications (CWC) sank as the
telecommunications business cautioned that stiffer competition and weak
demand from corporate clients had hit its business in Panama.

CWC's shares tumbled 11pc in morning trading on Friday as the group, which offers mobile and broadband as well as fixed line services, said the Panama business had not progressed as planned.

Mobile service revenue was higher in Panama during the six months to the end of September; CWC launched a high-speed mobile data network and began offering the iPhone 4S. But, the group added that mobile competition had intensified, with customers now able to keep their mobile number after switching networks, and that margins were under pressure.

"Our Panama business has not progressed as planned and as such we do not expect to achieve the outlook range for this business," said Tony Rice, CWC chief executive.

CWC now expects core earnings for Panama for the second half of the year to be similar to the $127m (£80m reported in the first half, putting it below the previously stated outlook range for the full year of $270 to $295m.

In Jamaica, CWC said its market position remained "difficult" and it continued to experience "poor financial performance" despite the growing demand for mobile data services.

That took the shine off a strong performance in Macau and the Bahamas. In the latter region, CWC expects earnings to exceed its previously stated outlook range of $60-80m; and in Macau, earnings are expected to exceed forecasts of $150-160m.

"The Bahamas continued to progress strongly in the period," said CWC. "In December we opened our refurbished flagship store in Nassau and launched our high speed mobile data network - Bahamians previously only had access to 'second generation' (2G) mobile services."

"The buoyant Macanese economy has helped maintain a healthy level of enterprise revenues," it added.